Microsoft spokesman and Vice President of Communications Frank Shaw used the official Microsoft blog post to pen a post titled 'Apples and Oranges' which lambasted Apple's new iPads and new version of iWork, which will come free with every iPad.
"Since iWork has never gotten much traction, and was already priced like an afterthought, it's hardly that surprising or significant a move," Shaw said.
"And it doesn't change the fact that it's much harder to get work done on a device that lacks precision input and a desktop for true side-by-side multitasking."
The move could be seen as retaliation for Apple CEO Tim Cook describing Apple's competition as "confused" in yesterday's keynote.
"Now they're trying to make PCs into tablets and tablets into PCs," Cook said, in an obvious jab at Microsoft."Who knows what they'll do next?"
Apple used its keynote yesterday to unveil its iPad Air and an iPad Mini with Retina Display, also announcing that the tablets would come with a new version of iWork which will allow users to collaborate with other people in the cloud and share their work. This will mean the iPad is now more in direct competition with Microsoft's more work-oriented Surface offerings, which boast Microsoft Office capability.
"Surface and Surface 2 both include Office, the world's most popular, most powerful productivity software, for free and are priced below both the iPad 2 and iPad Air respectively," Shaw wrote in the blog post.
"Making Apple's decision to build the price of their less popular and less powerful iWork into their tablets not a very big (or very good) deal."
"When I see Apple drop the price of their struggling, lightweight productivity apps, I don't see a shot across our bow," he said, "I see an attempt to play catch up."
Ovum chief telecoms analyst Jan Dawson said the move to make iWork free was a substantial threat for Microsoft.
“Microsoft generates 96% of its operating margins from operating system and productivity software licensing, and Apple is now teaching people to expect both of those things to be free," she said.
"While this won’t disrupt Microsoft’s business overnight, it will create further pressure on Microsoft to bring down prices for its productivity software and especially for Windows.
“This is yet another example of one of the keys to being a successful player in the consumer tech market: using your core business to subsidize low-cost or free products in other categories. Amazon uses its e-commerce and digital sales to fund devices, Google uses advertising revenue to fund its software and services, and Apple is now using hardware to subsidize software across the board. The big question is, what can Microsoft do to compete, when its cash cow is being eroded by these moves from its competitors?”